He said it did not matter if the psychosis was transient, Heuer still had "a disease of the mind" when he repeatedly stabbed Robin Drury and Rodney Pettitt in a Hervey Bay apartment on November 18, 2008

"He is, I believe, quite insane," he said.

Heuer is facing a two-day contested sentence after pleading guilty last year to attempted murder.

This followed an aborted trial and years in the Mental Health Court until he was deemed fit to stand trial.

Crown prosecutor Brendan Campbell said Heuer had been assessed as a "habitual grandiose liar" and suggested he was "playing out a fantastic story".

The court heard Heuer had claimed to be an SAS soldier who had been to Cambodia.

But Dr Fama said Heuer was irrational and delusional when he tried to kill the two men, suggesting Heuer had schizophrenia and suffered an abrupt violent psychotic episode.

He said Heuer was shouting about people planning to kill him and called police in the middle of the attack, believing what he was doing was right.

"There are simply stories told to impress others," he said of the lies.

"Here we're dealing with a vicious attack on innocent people ... accompanied by a strange disturbance of emotional expressions and by really bizarre behaviour wanting to phone police in the middle of it.

"He was acting irrationally."

Justice Jean Dalton questioned how Mr Drury, who had helped Heuer financially, could have been a threat when he was asleep at the time of the stabbing.

"He didn't believe the man lying down was going to kill him, he thought other people were going to kill him," he said.

Fellow psychiatrist Kevin Calder-Potts said it was unclear why Heuer would have wanted to harm Mr Drury.

"The idea was in his head but the motivation remains obscure," he said.